Love ‘em or hate ‘em? What say you?
Apartment Locators or Licensed Real Estate Agents are a part of traffic generation in many markets. Some properties swear by them, and others disdain the use of this source of traffic. Maybe there is a middle ground that will work for most apartment operators.
Think Before You Choose to Exclude This Source of New Residents
If you are sitting at 98% with a waiting list, paying for referrals from locators might be unnecessary. Yet, if you are looking at multiple vacancies, a bunch of notices, and a drop in demand, a referral from an apartment locator can be found rental income.
How Much Should I Pay? Locator commissions vary by market from zero to one month’s rent…or even more. You hate to see a month’s commission given away for a new lease; I get that! But if the apartment is going to be vacant over 30 days otherwise…or if you have multiple vacancies of that floorplan, a locator lease is not an expense, it is found rental income.
So, Should I use Apartment Locators?
It depends. I would caution the use of a blanket policy for all your communities (or property floorplans) because locator referrals add a lot of value in many markets. You know the drill: How many vacants do you have? What is on notice? What are your average days vacant? What is your current cost per lease? These stats will help you make the right move. Don’t see locator traffic as a crutch or a reflection of poor marketing. Rather, apartment locators are one of many tools in your marketing strategy.
Rick’s Apartment Locator Considerations:
- Stay friendly and professional with the apartment locator community even if you don’t use them. You never know when you might!
- What do you care if locators escort their clients or just notify you by email or text? As long as it is a qualified lead the effort by the locator is irrelevant.
- But most apartment locators work hard to create their referral pool and do extensive screening before getting the prospect to you.
- It is true, locators don’t care where their referrals go as long as they earn a commission. But they do favor friendly onsite leasing pros with effective sales skills.
- In most markets, 100% commission talks…if you are getting locator referrals at 50% then likely your rents are too low, or your rental criteria is below standard.
Disclaimer and Final Thoughts
Many of you know that I owned J. Ellis Apartment Locators for 35 years with offices throughout the Dallas/Fort Worth Metroplex. I sold that company to my good friend, Nancy Robbins, years ago. I also do apartment lease-ups in markets where apartment locating is unheard of. I predict we are entering a time in the multifamily market cycle when locators will be an even more important factor in your marketing and leasing. And they will be imperative for new construction lease ups. Plan accordingly.
